Buying a new construction home through a place like Diamond Realty has its advantages; you get to customize the house, you get up to date building codes, and you also expect fewer repairs compared to pre-owned homes. However, you should know that buying a new construction home requires some special precautions that may not be necessary when buying a pre-owned home. Here are some of these precautions:
Research the Builder
When buying a pre-owned home, you just need to inspect it to confirm that it doesn't harbor any defect. The test of time usually weeds out defective houses from perfect ones. However, this may not be the case with a new construction home since it's not easy to spot a defect when everything's new and shiny.
Since you can't have a "wait and see" attitude for a newly-constructed house, the next best thing is to research the reputation and previous works of the builder. If the builder has a good reputation and they have constructed perfect houses in the past, then you can safely assume that the current one is just as good.
Here are three practical ways of getting more information on the builder's reputation:
- Talk to local real estate agents
- Consult the Better Business Bureau (BBB)
- Visit local houses the builder has constructed
Know What the Warranty Covers
Secondly, you should ask about the warranty situation for the house. Again, this might not be a big deal for a pre-owned house, especially if it has lasted several decades since it's likely to have outlived its warranty. However, a newly built house is likely to be still under warranty, so you need to get clarification on that.
Note that a home usually has multiple warranties. For example, there is the builder's warranty, which covers major structural defects in the house. There may also be manufacturer's warranties, which cover individual appliances or installations, such as windows.
Confirm That Your Lender Will Pay For The Upgrades
Most new homes come with a base price, which represents the price you will pay for the standard version of the house. However, you don't have to buy the house in its standard form; you can ask the builder to upgrade some sections for you. For example, you may ask for a high-quality carpet instead of the standard one.
However, just because you were pre-approved for the house, it doesn't mean that you are also pre-approved for the upgrades. Therefore, before you include any upgrades in your purchase contract, it's best to run them by your lender first. Otherwise, you may find yourself having to pay for the upgrades out of your pocket.